Blaine Kitchenware Case Study

336 Words Jan 9th, 2018 1 Page
At the same time, the extreme liquidity of the company that can be seen as an operational strength/stabilizing factor, to some degree, also contributes to significant drains on profitability ratios and to the efficiency of asset utilization, as measured by the asset turnover ratio. Even counting the totality of the company's liabilities as debt, the debt/equity ratio would only be the third highest amongst competitors and not at all dangerous to the company; as it is, the debt level is negative to a substantial degree. On a relative and absolute basis, the company is highly underleveraged.
2) Clearly, a major repurchase of stock using cash assets and some additional borrowing changes things dramatically. Asset turnover almost…

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